MALAYSIA’S AirAsia has entered into a joint venture agreement with Tata Sons and Arun Bhatia of Telestra Tradeplace to set up an airline in India to tap the country’s growing aviation sector.
This proposed partnership follows the September 2012 decision by the Indian government to open up the aviation sector to direct investment of up to 49 per cent from foreign carriers.
The joint venture plans to operate from Chennai, focused on providing domestic second- and third-tier city connectivity to Indian travellers. AirAsia currently connects Chennai, Bengaluru, Tiruchirappalli, Kochi and Kolkata to ASEAN destinations through its operations in Thailand and Malaysia.
AirAsia founder and group CEO, Tony Fernandes, remarked: “We have carefully evaluated developments in India over the last few years and strongly believe that the current environment is perfect to introduce AirAsia’s low fares, which stimulate travel and grow the market.”
Subject to the Indian Foreign Investment Promotion Board’s approval, the proposed joint venture company will make an application to Indian aviation regulators for the air operator permit.